Among the arguments against copyright law is the argument that copyright is not a property right. The “robust history” of describing copyright in terms of property 1See Justin Hughes, Copyright and Incomplete Historiographies: Of Piracy, Propertization, and Thomas Jefferson, 79 Southern California Law Review 993, 1004 (2006); Myths from the Birth of US Copyright. is simply wrong, say proponents of this argument. One line of such arguments claims that property rights are only justified to resolve conflicts over scarce goods. Because expressive works protected by copyright are not scarce — that is, one person’s use of a book, song, or film does not diminish another person’s ability to use that same work — the necessary condition for legitimate property rights is not met.

It is this view of copyright that seems to have informed the recently retracted Republican Study Committee policy brief on copyright law. The brief rejected the characterization of copyright as property right and instead characterized it as a monopoly privilege antithetical to free market principles.

I want to suggest an argument today that counters this conception of copyright. It is, in fact, concerned with scarcity. The error comes from mistaking the actual right at issue — the right to copy (hence, “copy right”) — with the actual right at issue with tangible goods, typically a right to possess.

Property is, at its heart, the set of rules concerning the relationship between individuals and things, and is one of the foundational legal doctrines, along with contract and tort law. Because property is conceptual, it, by definition, is not barred from being applied to intangible goods.

But some have made the argument, explored in more detail below, that property rights are only legitimate when they apply to scarce goods, ie, goods where one person’s use prevents its use by someone else. Property rules originated to resolve conflict over such rivalrous goods, so if a certain good is not rivalrous, then recognizing a property right in it is not justified.

What is Property?

In his 1990 article What is Property?, 213 Harvard Journal of Law & Public Policy 775 (1990). libertarian scholar Boudewijn Bouckaert provides an account of scarcity, saying it both explains and justifies property rights. While the concept of scarcity is discussed by earlier philosophers and legal theorists, the modern “law and economics” view places scarcity front and center as a rationale for these rights.

Scarcity is defined by Bouckaert as arising “when two or more persons consider one good as a means for the satisfaction of their wants and when the use they intend to make of it is incompatible.” But he prefaces this by noting that scarcity likely involves a “dimension beyond mere allocation” — solving allocative scarcity would require a “super-individual authority” to divvy up how and when competing individuals could use a certain good. So, we’re concerned primarily with distributive scarcity, which is unavoidable and leads to three possible outcomes, according to Bouckaert: “(1) permanent conflict–the assignments of scarce means are the result of the use of violence, ruse, and tactical games; (2) resignation–a resource becomes the object of competition, both parties withdraw, and such withdrawal means isolation and a massive drop in world population; (3) rules–assignments of power over scarce resources to individuals, groups, families, the government, and so forth.”

Bouckaert distinguishes between natural scarcity, which occurs prior to any social or political institutions, and artificial scarcity, which is the result of arrangements by such institutions. In the “law and economics” view, the first justifies property rights, but the second requires its own justification.

For purposes of this article, I will assume this argument is valid. But I do want to point out that the argument that property rights require scarcity is a minority view, one that has not escaped its share of criticism. Philosopher David Faraci, for example, has asked Do Property Rights Presuppose Scarcity? and concludes that the argument has thus far been under-motivated. Faraci notes that many dominant theoretical views of property appeal to values beyond the conflict-resolution inherent in the scarcity view of property rights. IP scholar Robert Merges rejects this “historical-essentialist” concept of property outright, in favor of a more “broad and roomy” conception whose “origins do not imply constraints of limits.” Merges sees a “powerful logic” in property, and its “restless capacity” to morph and adapt throughout its history to different arenas provides a robustness that makes as much sense to apply to intangibles as to physical property. 3Robert P. Merges, Justifying Intellectual Property, pp. 4-5 (Harvard University Press 2011).

Though whether or not copyright is considered “property” may seem like a matter of semantics, it does have implications for the proper role and scope of copyright law. If copyright is redefined as being something other than property — a “mere privilege” or an economic monopoly, for example — it is easier to argue that it is inconsistent with free market principles rather than being the mechanism for establishing a functioning market that fosters investment and dissemination of creative and expressive works.

Property in the Copy Right

Property is sometimes defined as including the right “to possess, use, enjoy, and dispose of a thing.” Possession is often considered one of the most basic of rights held by property owners. It is this right that is typically discussed when dealing with scarcity: only one person can possess a good at any given time.

Copyright, however, is not concerned with possession. Indeed, things get pretty metaphysical real fast if you start talking about how one can have possession over the intangible expression of an idea. Copyright instead is concerned with copying, which can be considered a specific form of using the property. 4Public performance and public display could similarly be mentioned here, though I leave them out for readability sake.

Copying, the act, should be distinguished from the copy, which is the material object that includes the expressive work in fixed form. These copies are treated as any other form of personal property. In fact, the US Copyright Act expressly distinguishes between copies and copying and notes that the right to copy is not the same as ownership in the resulting copies. 517 USC § 202, “Ownership of a copyright, or of any of the exclusive rights under a copyright, is distinct from ownership of any material object in which the work is embodied. Transfer of ownership of any material object, including the copy or phonorecord in which the work is first fixed, does not of itself convey any rights in the copyrighted work embodied in the object; nor, in the absence of an agreement, does transfer of ownership of a copyright or of any exclusive rights under a copyright convey property rights in any material object.”

The act of copying an expressive work, like the act of possessing a physical item, is rivalrous. Your copying of an expressive work diminishes my ability to copy an expressive work.

Odds and Ends

Now, in order to support this argument, one would need to include several additional claims.

First, we need to assume that we are dealing with a finite limit on the amount of copying that can occur. Expressive works are, after all, potentially infinitely reproducible — and, when they exist digitally, those copies can be made at near-zero cost.

But I think this focuses on the wrong thing. We could, in theory, reproduce any given work infinitely. But in practice, we don’t. A few weeks ago, Psy’s “Gangnam Style” music video became the most viewed video ever on YouTube, with over 800 million views and counting. Eight hundred million is a big number, but it’s still far less than infinity. Even the Bible itself, one of the most widely printed books for hundreds of years, has been printed an estimated six billion times.

So even given the fact that if we had an infinite amount of storage space and an infinite amount of time, we could infinitely reproduce any given work, I don’t think that is relevant. As a practical matter, we are always dealing with a naturally (and economically) scarce ability to copy an expressive work.

Second, we could assume that productive use of resources is inherent to any property system. This is apparent from the very term “law and economics”, where the law prong is concerned with resolution of conflict over scarce resources but the economics prong deals with creating value. Generally, we’re not driven to conflict merely because we are all Gollums, obsessing over our precious things. We seek them because of the value they can provide in producing wealth. Historically, copying has been one of the primary methods (though certainly not the only method) of extracting value from expressive works.

Finally, a caveat.

By saying that copying is rivalrous, I don’t mean to suggest that this rivalry exists anywhere near a 1:1 relationship. That is, I’m definitely not suggesting that “every download is a lost sale” or anything like that. It is simply an act that can be incompatible between two or more people. This is similar to possession: scarcity in this sense doesn’t imply a requirement that the use of a scarce good by two or more people has to occur at the same time or wholly deprive one of the use of the good. For example, if I use your hammer while you’re asleep, you haven’t “lost” anything. There simply has to be that potential for incompatible uses prior to any application of property rules.

Public performance and public display could similarly be mentioned here, though I leave them out for readability sake.

5.

↑

17 USC § 202, “Ownership of a copyright, or of any of the exclusive rights under a copyright, is distinct from ownership of any material object in which the work is embodied. Transfer of ownership of any material object, including the copy or phonorecord in which the work is first fixed, does not of itself convey any rights in the copyrighted work embodied in the object; nor, in the absence of an agreement, does transfer of ownership of a copyright or of any exclusive rights under a copyright convey property rights in any material object.”

18 Comments

I wonder how the ‘no property without scarcity’ brigade would deal with the following case?

Suppose that a public body invests in a major infrastructure project, such as a bridge across a river. The project is extremely expensive, and to finance it the body concerned decides to charge a toll on every user of the bridge. Now suppose also – a key assumption – that the bridge has sufficient capacity for everyone who would wish to use it, even if there were no toll. Each user is therefore not excluding any other person from using it. In the jargon, use of the bridge is a ‘non-rivalrous’ service.

Would the aforesaid brigade conclude from this that there is no ‘scarcity’ in use of the bridge, and that it is therefore unnecessary and unjust for the owners of the bridge to charge a toll?

I suppose there is no depth of folly to which some people will not descend, but I suspect that in this case even the brigade would balk at such an obviously daft conclusion. Although there is no scarcity in the *use* of the bridge, once it is built, there is obviously a scarcity of bridges as such, because they are very expensive to build. In this case, even a blind bat in a dark cave can see that the bridge somehow has to be paid for, and that charging a toll is a reasonable way of doing so and – arguably – economically more efficient and equitable than paying for it from taxation falling on users and non-users alike.

The analogy with copyright is clear enough. Copying a work is like using the bridge. Creating the work is like building it. Once a work of art, literature, etc, has been created, copies of it are non-rivalrous and non-scarce, but scarce resources – of talent, effort, etc – are needed to create it in the first place. Those scarce resources need and deserve to be paid for (assuming that there is a demand for the work), and charging users of the work a ‘toll’ is the obvious and efficient way to do so.

Based on the amount of people willing to run through the tolls in NJ without paying it your analogy is probably pretty dead on. If you have tolls with very low enforcement a good amount of people will not pay their toll. And how is it fair that the state already paid back the loan on building the highway and is now just using that money as revenue for other things? Tolls are just a way for the government to steal money from hardworking people.

I have a dollar bill.
You scan it and make a copy.
I’m not ‘out’ “my” dollar, right?
But, in the act of you making an illegal copy, my dollar is devalued each and every time an illegal copy is made. The more ‘copies’ that are made, the less my dollar is worth.
———-
If i take a blank canvas and paint a masterpiece, the value i created is (hopefully) worth more than the common materials used to make it. The value doesn’t come with the paint, paintbrushes, canvas and such, it comes with the dedication of the artists years of mastering the skill of painting and time invested in the creation of the work. I can hand ‘Joe’ some paint and a canvas, but try as he might, he may never conjure up a worthwhile masterpiece. Same with the original artist. It’s the social contract that states that someone taking the risk and sacrifice of spending untold time mastering their skill that they have just the chance of a return on their considerable investment of time and money, and that someone else can’t just hop in and claim that hard work as their own- with no recourse. Copyright is the incentive that gives the artisan the hope of return, not a guarantee mind you, just the chance to offer up their wares in a fair marketplace. Without copyright, there is zero incentive for one to dedicate their life and make the sacrifices necessary to do such. Sacrifices include time that one could otherwise spend working their way up the career ladder of another profession. We give that up just for a CHANCE at making something worthwhile at considerable risk to our quality of life. Without copyright, we will live in a dull world indeed. We need dreamers and passion in our world more than we need another banker or politician.

David and James have both made excellent arguments. Here’s another way of illustrating their points:

Labor is a scarce good and, as such, should be compensated (presumably even Bouckaert agrees that slavery is unacceptable). Laborers — such as plumbers, baby sitters, doctors, US senators, NBA players, and UN Peacekeepers — who provide scarce services that others value, are paid for their labor by the beneficiaries of that labor. The rarer and more unique a laborer’s services are, the more the services cost. Some service providers (e.g., plumbers, baby sitters and doctors) get paid more or less directly, by the individual beneficiaries of their services. Others (e.g., US senators, NBA players and UN Peacekeepers) get paid indirectly by the group that benefits from the services (e.g., by US citizens via taxation, by basketball fans via ticket sales and the NBA’s share of cable fees (among other means), and by the nations of the world, via dues and other payments).

Now consider artists. For example, consider a motion picture production team (producers, director, cast, crew) that produces a popular movie . The team provides labor/services to create something that others want — i.e., a valuable experience. Just as NBA players get paid for creating valuable experiences by those who partake of them, motion picture production teams expect to get paid for their valuable services by those who partake of them. To download a movie without paying for it is to accept the benefit of a scarce service without compensating the service providers. Unless artists are going to be treated as a unique class that deserves to labor without payment (i.e., slaves), they should be compensated for their labor by those who benefit from it.

I recognize this post was probably intended only for people who intrinsically agree with your normative position (especially judging by the comments), so I apologize for intruding on this conversation. However, a thought. If you’re going to take the position that (a) copying of intangible works has a natural scarcity because the size of the economic market is capped, or (b) (as your commenters argue) the labor used to create intangible assets is scarce and therefore should be compensated, doesn’t this position lead to the natural conclusion that copyright should restrict only activity that economically displaces cash that the creator should get? In other words, all other forms of non-substitive copying should be unrestricted (say, parodic copying), because that has no impact on the scarce resource. At that point, then, either you have to shift to non-scarcity arguments to restrict that copying, or you have to take the position that non-substitive copying still should be within the economic purview of the creator, but you’d have to explain why. Eric.

I’m not sure exactly what you mean by “parodic copying,” but in general parody has long been OK, in the U.S. at least. If it wasn’t we wouldn’t have Saturday Night Live. Or pretty much any Mel Brooks movies (which would be sad because I am quite the Brooks fan). I don’t think a lot of artists are interested much in restricting parodies.

I’m also not familiar with the word “substitive” and can’t find a definition. Perhaps you could clear up what you mean? I can’t tell if it’s related to substitution or substantial.

Moving on…

doesn’t this position lead to the natural conclusion that copyright should restrict only activity that economically displaces cash that the creator should get?

I suppose it would if you look at the world through the lens of an economist. Thankfully, most people don’t and are smart enough to ignore them. Money isn’t the only ‘financial’ reward that exists; especially as people are absorbed deeper into digitalia. You have Valley ties, I’m sure you’re familiar with the “reputation economy.”

What if someone’s income depends specifically on their reputation as a writer? Say, they give lectures in lieu of selling books. Then damaging their reputation would be an economic displacement, and it follows then that parody and satire would have to be illegal on an economic basis. Convoluted, I know. That’s why I don’t think all laws should be based on economic principles. Actually, as an artist, seeing our world dragged further and further down that road is positively terrifying.

However, follow your own logic backwards. This is an example I believe may have been brought up in this post: if you’re going to require that scarcity is the only thing that can make something “property” then the natural conclusion is that it’s OK for a thief (err… infringer?) to “borrow” your car while you’re sleeping. A rivalrous product is only thus when there’s actually a rivalry for it.

On the other hand, maybe taking everything to its logical extreme should be avoided unless one is writing a sci-fi story.

I’m sympathetic, but I don’t think this argument really works in the way you’ve framed it here. I think the scarcity you’re looking for exists, but not in the number of possible acts of copying. Rather, it exists in the number of opportunities to use the work as a basis for the exchange of value. The mere act of copying in and of itself does not necessarily consume such an opportunity. If I print a million copies of a book and bury them at the bottom of the ocean, the author’s interests are not harmed. Because what matters isn’t that copies were made, but that no one is going to make use of them to get the benefit of the author’s creative work. Similarly, if one person listens to a song on Spotify, even though that stream involves the making of numerous intermediate digital copies, it remains the case that only one person has listened only once, and that is the only scarce opportunity that has been consumed. Copyright law uses the act of copying as a proxy for the likely consumption of value, because it used to be a fairly accurate one, and was easy to detect. Most people don’t print a million copies in order to dump them in the ocean. Each of those printed books is clearly intended to (and likely to, if distributed) satisfy at least one person’s demand for the experience of reading the book. What copyright is trying to do is give the author the right to satisfy that demand, so that the productive labor of creation can serve as a basis for exchange of value. Really the harm we are trying to prevent comes only with distribution, but distribution can be difficult to detect and it is much easier to focus on printing presses. Or was, anyway. In today’s world, the way in which acts of copying relate to opportunities of making the work available for consumption has changed radically and no longer provides a very good proxy. I actually think authors would be better off if we scrapped the reproduction right altogether, in exchange for a clearly established “make available” right. This would remove a lot of the overbreadth that tends to give copyright a bad name, when owners use incidental acts of copying as hooks to appropriate value that really doesn’t stem from consumption of the value the author was trying to create and exchange.

So I would agree with Eric that only “substitive” acts should trigger copyright, but also with Patrik that cash isn’t the only touchstone of substitution. I would argue that the fundamental purpose of property is to make it possible for people to use their productive labor to further their life projects in a social setting, whether through immediate use or by exchanging the value they create with others. Not all value is captured in money. I’d be surprised if Eric actually disagrees on this point. Surely people who grant Creative Commons licenses should not lose the right to enforce their copyrights against those who exceed the bounds of the license just because they are not seeking monetary compensation. Some people want to be paid in attribution, or in the knowledge that downstream users are NOT monetizing their work. (E.g., Jacobsen v. Katzer, where the injunction should have been granted but wasn’t.) What I want to mean by “substitive” use is: acts that result in someone consuming opportunities for the author to use his or her work as the basis for an exchange of value. Obviously more needs to be said to properly refine and cabin this principle, and one of the main things is to take to heart Eric’s point that truly transformative uses are not really uses of the author’s work, and so should not be within the scope of the author’s rights. ( If you have the stomach for my lengthy attempt to flesh out this point, you can find it here: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1688585 ). But I get the sense that most of the players who have a real stake in defending copyright understand this point. Not all of them–there is still overreaching. But my guess is that most copyright owners would happily endorse a definition of transformative fair use that was even more robust than they think it should be, in exchange for a clear commitment to protect them from flagrant massive-scale infringement of the types that no one seriously claims to be fair use.

Give up Human & Constitutional Rights “in exchange”… for what? The same protection that EVERY other business and private citizen enjoys? I don’t like the basis of that sort of change…so non-starter, thanks…

Copyright is a Constitutional right.
Artists’ rights are in most every international Human Rights declaration/treaty.

While i would welcome the short-term gain to my pocketbook, this isn’t a game of checkers.
Theoretical protection in exchange for Rights don’t wash with me. Sounds suspiciously like extortion. This is exactly the Digerati’s end-game.

Say you now have these so-called ‘protections’ (which, you’re supposed to have anyhow.. ). Great… that helps this cycle, but what happens next? Next cycle they go and look at the books and eliminate the protections. “Why is this ‘protection’ on the budget? They are for a right that no longer exists, and thus we can’t justify the expenditure” -CUT- game over.

I’m all in favor of protection of my Constitutional rights, but not at the expense of the rights of future artists. This is the wrong conversation to have.

Sure. If you are an author, what is valuable to you isn’t really the ability to control the making of copies per se. As I tried to illustrate, the making of physical copies has a very imperfect correlation to the thing you really care about, which is people enjoying the benefits of the expression you have created. What you really want copyright to do is to somehow enable you to have a say in the terms on which access to those benefits is made available to people, so that you can use it to trade for something in return. Take something like Google Books. If you are an author, the mere fact that a scanned copy of your book is sitting there somewhere on Google’s server doesn’t impact you one way or the other. What would impact you would be if Google started making that book available to people to read without your consent. That’s because the benefit people get from reading your book represents the value you were trying to create by writing it and that you are supposed to have a right to bargain over. But there are lots of things Google can do with the scanned copy that are very socially valuable, and that don’t hurt your ability to sell the right to read your book. Like search results or data mining. I’m suggesting that to have a big battle over whether Google needs your permission to make the scanned copy is a waste of time, because what you should really care about is what they do with it–whether they are making it available to people for reading in a way that destroys your ability to benefit from the expression you are trying to sell. And conversely, I think that this is a case where protecting your right to prevent Google from making that scan serves only to give you power over things like search engines and data mining, which isn’t really what copyright is for. Impeding things like that is overreaching, and is the sort of thing that gives copyright a bad name and undermines public support for it.

The use of scarcity in discussions of copyright are merely a distraction aimed at devaluing intellectual property. It fails on two grounds. First, as long as copyright is enforced, there is by definition scarcity. It is only by violating copyright that an item is no longer scarce.

On a more fundamental level, copyright is a property right based on the same principle that leads to all property rights. That principle is self-ownership. I think it is a fairly uncontroversial statement to say that we own ourselves. If this is not true, then there is no moral or legal basis to oppose slavery.

If we start with the principle of self-ownership, it is obvious that we also own our work or effort. Normally we trade our work for pay. Writers and artists don’t tend to do this. They retain their ownership of their work. While scarcity may play into the value of one’s work, it is not necessary to establish ownership of one’s work.

As long as it established that property rights derive from ownership of one’s work, then copyright is very clearly a property right with all appropriate protections.

The idea of copyright as a natural right is sometimes seen as ‘un-American’, because the copyright and patent provision of the US Federal Constitution seems to put the basis for federal copyright law exclusively on economic expediency rather than individual rights. But this overlooks the fact that most of the then-existing states had already enacted copyright laws, usually following closely the Statute of Anne, and in some cases explicitly referring to considerations of natural rights:

‘As the principal encouragement such persons [persons learned and ingenious in the various arts and sciences] can have to make great and beneficial exertions of this nature, must exist in the legal security of the fruits of their study and industry to themselves, and as such security is one of the natural rights of all men, there being no property more peculiarly man’s own than that which is produced by the labour of his mind’ – from the Preamble to the Massachusetts statute on copyright, 1783 – for full text see http://copy.law.cam.ac.uk/cam/tools/request/showRepresentation?id=representation_us_1783d

The federal constitution made no such reference, but this does not imply that the framers rejected the natural rights doctrine, merely that they did not consider it necessary as a basis for federal copyright law.

About

Copyhype provides news and info on current developments relating to copyright law, the media industries, and the digital economy. It cuts through the hype to bring reasoned discussion aimed at both legal and nonlegal audiences.

Terry Hart is currently Director of Legal Policy at the Copyright Alliance. Any opinions expressed on this site remain his own and not necessarily those of his present or any past employers.